What is an Exploration Licence?

An exploration licence is a title granted by the NSW Government to individuals and companies who wish to explore for minerals. Applicants for an exploration licence must demonstrate to the Department of Primary Industries (Mineral Resources) that they have the financial and technical resources to carry out an exploration program. Licence holders are required to spend a specified amount of money on exploration.

An exploration licence does not permit mining nor does it automatically follow that a licence holder will be permitted to mine in the future even if a discovery is made.

How do I know if an Exploration Licence has been applied for over my land?

The applicant for an exploration licence will be requested by the Department of Primary Industries (Mineral Resources) to advertise the lodgement of all exploration licence applications in a newspaper circulating throughout the State and in a newspaper circulating in the District in which the land applied for is situated.

If there is an Exploration Licence over my land can I add any improvements, ie, shed, house, dam etc?

An exploration licence does not prohibit you from making improvements on your land, but those improvements will be subject to relevant approvals, eg local council etc.
 

What does an Exploration Licence entitle the holder to do?

An exploration licence gives the holder the exclusive right to explore for the minerals specified in the licence. It does not automatically entitle the holder to enter any of the lands in the area covered by the licence.

Can I stop an Exploration Licence being granted over my land?

Although there is no provision in the legislation for formal objections you may write to the Department of Primary Industries (Mineral Resources) objecting to the grant of an exploration licence. However on most occasions it is more appropriate to raise concerns after the licence is granted, if and when the holder seeks to explore on your land. 

Can the Exploration Licence applicant immediately commence work?

No. It takes a number of months before the Department processes and eventually grants the exploration licence. In that time no work can take place. Once a licence is granted a licence holder must negotiate an access arrangement with the respective landholders before exploring on their land.

Also before any operations take place on native title lands the provisions of the Commonwealth’s Native Title Act and the Mining Act 1992 need to be addressed.

What happens when we reach agreement regarding access and compensation?

Once an exploration licence has been granted and the matter of access has been settled a licence holder can commence exploration. The licence contains strict conditions which are designed to minimise the effects of exploration on the environment and ensure rehabilitation of disturbed areas. A substantial security deposit is held by the Department of Primary Industries (Mineral Resources) to ensure that the conditions are complied with.

The licence also states what exploration activities are initially permitted without further notification and approval of the Department. A minimum level of expenditure on exploration is required but in some smaller licences a minimum level of expenditure is not imposed. The licence holder must submit six-monthly reports to the Department on exploration carried out.

What methods are likely to be used in the exploration program and what impact will they have on my land?

An exploration program involves sifting through a lot of information about a district before concentrating on very specific (usually small) areas of main interest. Early work usually involves a casual visit by a geologist or technical officer to look at rock outcrops. Sometimes they may gather small samples from streams (“stream sediment sampling”) or from rock or soil for chemical analysis. They may spend some time walking across the area mapping the rocks particularly if there are old mines nearby. It is usual however that large areas (possibly including your property) would not be visited at all.

If an area of interest is identified during this reconnaissance work further testing may occur. Generally this would involve surveying the area taking further small soil or rock samples for analysis and possibly costeaning or trenching. Probing beneath the surface with electronic instruments (“geophysical exploration”) would be a typical procedure. Most of these techniques do not involve significant disturbance of the ground.

If a “zone of mineralisation” is indicated the next phase of exploration would usually involve drilling. Mineralised zones are rare, commonly only one or two occurring within an entire exploration licence area. Drilling is expensive and normally only one or two holes would be drilled to test a zone using truck-mounted drill rigs. However a target would have to be of considerable interest to warrant the expense of such intensive exploration.

Will my land be left in a mess?

No. Strict conditions are attached to the exploration licence which require any sites of disturbance to be restored (“rehabilitated”). The Department holds a substantial security deposit in case the licence holder fails to meet this obligation.

For how long may the licence be granted?

An exploration licence may be granted for a period not exceeding five years. The licence may be renewed for further periods each not exceeding five years. An exploration licence is generally granted and renewed for terms of two years.

Will this exploration inevitably lead to a mine?

No. The carrying out of an exploration program in most cases does not lead to the discovery of a viable mineral deposit. In addition, there is no guarantee that an exploration licence holder will obtain a mining lease.

How does the company obtain the right to mine?

If the exploration program identifies a deposit of an economic size and grade, the company has to obtain a development consent and a mining lease before it can start mining. For large developments like a coal mine, the designated authority who gives consent is the Minister for Planning. 

When the company makes its application for development consent it also has to submit an Environmental Impact Statement. This is a comprehensive document that must deal with the effect of the mine on the environment. It must cover such matters as air quality, noise, transport, flora and fauna on the site, water management, method of mining and rehabilitation. Special consultants are used to deal with the particular issues.

How can the community complain about aspects of the mining operation?

If residents believe that the company is not adhering to the conditions of its development consent, they should contact the appropriate authority, such as the EPA or the local Council.

Many of the new mines currently being developed have established community liaison committees which have community representatives as well as representatives of local Councils. These committees meet regularly and residents can contact members of the committee about matters that concern them.

Please Note

This information brochure contains generalised information for the interest of the public. You should seek assistance from your solicitor or the Department of Primary Industries (Mineral Resources) if you require more specific advice on matters relating to the Mining Act 1992.